Responding to increasing demand for debit cards-and a recent publicity blitz about potential misuses-the bank card associations have stepped up efforts to educate consumers about the products.
Last summer Visa U.S.A. and MasterCard International announced with fanfare that they were capping consumer liability for unauthorized transactions on debit cards at $50. Now both associations have teamed with consumer advocacy groups to distribute literature about using the cards safely.
The pamphlets strive to clear up confusion over the relatively new payment products and to remind customers what to do if cards are lost or stolen.
This month MasterCard released a brochure it produced with Call For Action Inc., a consumer group based in Bethesda, Md.
Meanwhile, Visa, working with the National Consumers League of Washington, D.C., plans to unveil a similar promotion in October.
The consumer groups will distribute the pamphlets, which describe the differences between off-line and on-line debit and remind customers to report a lost card. They have also established toll-free telephone numbers to field consumer inquiries.
The card associations, which are paying for the literature, will make it available to member banks.
Consumer education is nothing new in the world of debit cards: MasterCard and Visa have focused on education in television commercials and have previously formed debit card-related alliances with consumer groups.
But the associations seem lately to have stepped up their pedagogical efforts, as consumer fears over liability have persisted. Another lingering confusion is over debit card nomenclature: MasterCard calls its debit product MasterMoney, while Visa uses the term "Visa check card."
"Consumer education is probably the final piece that will make this fully accepted by large numbers of consumers and used frequently in the years to come," said Arthur E. Clark Jr., partner at Business Dynamics Consulting of Nyack, N.Y.
Compared to other consumer payment methods, debit cards are still in their infancy, representing only 1% of the market, according to The Nilson Report of Oxnard, Calif.
But the card associations are reporting rapid growth. In 1996 MasterCard's charge volume was $8.7 billion, up more than 100% from 1995. Similarly, Visa reported $54 billion, a jump of 70% from 1995.
Consumer awareness has increased, too: A recent survey commissioned by Visa and conducted by Gallup Organization said 80% of 2,000 respondents knew what a debit card was.
But consumers may not be as savvy when a debit card is lost or stolen. Another recent survey, sponsored by MasterCard, found 59% of people using debit cards did not realize the importance of reporting a missing card immediately after discovering the loss. The study, conducted by Opinion Research Corporation International of Princeton, N.J., also noted only 12% of the 1,000 respondents kept a list of the contents of their wallets.
The Call For Action brochure includes a "Wallet Watcher," a work sheet that prompts users to keep an inventory of their card issuers' telephone numbers.
"It will give consumers a handy and attractive piece of information that tells them what their rights are and their responsibilities are," said Shirley Rooker, president of Call For Action. Next month the organization will release a series of radio public service announcements it produced with MasterCard.
"We're providing them with a simple way to keep track of their cards," said Irene Katen, a vice president at MasterCard.
While other consumer advocates are supportive of the educational initiatives, some still call for more. Stephen Brobeck, executive director of the Consumer Federation of America, said, "The most important message to be conveyed (is that) consumers with unsustainable credit card balances should consider switching to debit cards for future purchases."
